Lang’s speech in Tsinghua

On 21 December 2005 Xianping Lang gave a speech in Tsinghua University. The topic is mainly about "socialisation of capitalism society". He argues that the reform in China has not achieved the original goal. In order to let all people in the society enjoy the outcome of economic growth, a more practical and complete law system should be established, as well as a stock market as a means of wealth distribution.

He argues that China's reform misunderstood Deng's idea "let a part of people become wealthy first". The wealth accumulation of this part of people should not be at the cost of other people's wealth. In other words, when some people are getting better, nobody should get any worse. Such Pareto Improvement, however, has not been realised in China. Then, Lang advocated that China should learn from the US, to use stock market to redistribute wealth.

However, Lang may evaded some difficulties in the stock market in China. Even if the legislation problem can be solved, how do stock market get everyone involved, considering the large portion of rural population in China? Even if everyone has shares in the market, can the economy support a high enough payback? Stock market along cannot solve problems in reform.

Lang talked a lot of problems in the reform, including health service and education system reform. Both are failures. Both can hardly be solved using stock market. Privatisation at present will only bring catastrophic results. Land did not give suggestions for these problems. But his speech did reveal the absurdity of such reform.

Lang mentioned socialisation. It is happening in the West. But it is not like socialisation after 1917 and 1949. It is more marketisation than planned socialisation in Communism states. Such notion make sense today in China. However, we must be aware that marketisation should be backed by sound law system and wise management of the government, to ensure equity and justice in this process.

The speech is marvellous in terms of language. Lang made his speech very stimulating and exciting. However, this also covered some ambiguous point. The most important thing is that Lang may never be welcomed by the government as by the students. His ideas cannot change the situation in China, either.